Artificial intelligence is being counted among the hottest startup sectors in India this year, but the highly specialised space is struggling to grow due to the lack of a primary input: engineers.

“Forget getting people of our choice, we don’t even get applications when we advertise for positions for our AI team,” said 25-year-old Tushar Chhabra, co-founder of Cron Systems, which builds internet of things-related solutions for the defence sector. “It’s as if people are scared of the words ‘artificial intelligence.’ They start freaking out when we ask them questions about AI.”

India has over 170 startups focused purely on AI, which have together raised over $36 million. The sector has received validation from marquee investors like Sequoia Capital, Kalaari Capital, and business icon Ratan Tata. But entrepreneurs are struggling to expand due to a shortage of engineers with skills related to robotics, machine learning, analytics, and automation.

Racetrack.ai co-founders Subrat Parida and Navneet Gupta said that around 40% of their working time is spent searching for the right talent. The organisation, which operates out of Bengaluru, has built an AI-driven communication bot called Marvin. “People are the core strength of a startup,” Parida, also the CEO, told Quartz. “So hiring for a startup is very challenging. We are not looking for the regular tech talent and, since AI is a relatively new field in India, you don’t get people with past experience in working on those technologies.”

The shortage

Only 4% of AI professionals in India have actually worked on cutting-edge technologies like deep learning and neural networks, which are the key ingredients for building advanced AI-related solutions, according to recruitment startup Belong, which often helps its clients discover and recruit AI professionals.

Also, many such companies require candidates with PhD degrees in AI-related technologies, which is rare in India.

While it takes a company just a month to find a good app developer, it could take up to three months to fill up a position in the AI space, said Harishankaran K, co-founder and CTO of HackerRank, which helps companies hire tech talent through coding challenges.

The reasons

India is among the top countries in terms of the number of engineers graduating every year. But the engineering talent here has traditionally been largely focused on IT and not research and innovation.

“Fields like AI require a mindset of research and experimentation,” said PK Viswanathan, professor of business intelligence at the Great Lakes Institute of Management in Chennai. “But most aspiring engineers in India follow a pattern: finish school, go to IIT, do an MBA, and then take up a job. To work on AI, you need people who not only have a strong technology background, but also have analytical thinking, puzzle-solving skills, and they should not be scared of numbers.”

Ironically, the subject has been a part of the curriculum at some engineering schools for almost a decade. However, what is taught there is mostly irrelevant to the real world.

Sachin Jaiswal, who graduated from IIT Kharagpur in 2011, studied some aspects of AI back in college. But whatever he is doing at his two-year-old startup Niki.ai – it has built a bot that lets users order anything through a chat interface – is based on what he learned in his earlier jobs, he said.

“A lot of people are disillusioned when they come out of college and begin their first jobs,” said Jaiswal, whose startup is backed by Ratan Tata.

In fact, even now, when he interacts with graduates from elite institutes to hire them, he sees a glaring gap between what these youngsters have learned and what is needed on the work floor.

Given the shortage of AI-related talent in India, several startups aspire to tap Silicon Valley. But that’s not a feasible solution for young teams.

A few months back, Chhabra of Cron Systems was in talks with a US-based engineer, an IIT-Delhi alumnus working on AI for seven years. “The guy asked for Rs 2.5 crore per annum as salary,” said Chhabra. “As a startup you cannot afford that price.”

Finding solutions

Cron Systems has found a jugaad to solve their problem, Chhabra said. Late last year, the company hired a bunch of engineers with basic skills needed to create AI-related solutions and trained them.

“We broke down AI into smaller pieces and hired six tech professionals who understood those basic skills well,” Chhabra said. “Then we conducted a three-month training for these people and brought them onboard with what we do.”

Niki.ai, too, is following this hire-and-train model. “Training takes time and investment but we have no option because we need the talent,” Jaiswal of Niki.ai told Quartz. “If we had better access to talent, things would have been better.”

Gurugram-based AI startup Staqu has started partnering with academic institutions to build a steady pipeline of engineers and researchers.

Hopeful

Despite this struggle, entrepreneurs and investors in India feel bullish.

In an ecosystem where e-commerce and food delivery hog the limelight, a recent report by venture lending firm InnoVen Capital named AI one of the “most under-hyped sectors.” But that is set to change, said London-based angel investor Sanjay Choudhary.

In September, Choudhary invested in Delhi-based AI startup Corseco Technologies. He regularly interacts with the company’s team and the “genuine issue of finding talent” comes up frequently, he told Quartz.

“India is a late entrant into the AI space and talent crunch will be a challenge for the industry for some time to come,” he said. “But I plan to continue investing in AI in India because I feel that the space has a lot of potential and needs to be supported.”

While there seems no end to the struggle, Jaiswal of Niki.ai sees a silver lining: “Talent crunch ensures that companies can’t enter the field easily. So we have a competitive edge.”

This article first appeared on Quartz.